Accounting Mcqs 12

Agha Zuhaib Khan

(1) Double entry book-keeping was fathered by: (a) F.W.Taylor (b) Henry Fayol

(2) Funds Flow Statement and sources and application statement are:’ (b) Antagonistic (c) None of these. (3) Depreciation in spirit is similar to: (a) Depletion (c) Depression. 4) Balance Sheet is always prepared: (a) for the year ended. (c) None of these. (5) In Insurance, the following Profit and Loss Accounts are prepared: (a) Separate for Fire, Marine, and Accidents etc. (c) None of these. (6) Partners in Pakistan can today be fixed at the following numbers: (b) 50 (c) 75. (7) Flexible budget is a budget with the following features: (b) Changes with variable expenses (c) Changes in Direct material. (8) Break Even can be calculated as under: (a) ______VC_______ FC- TR TC (c) None of these. (9) Quick Ratio can be computed as under: (a) Quick . Assets/Quick Liabilities (b) Quick . Liabilities Current Assets

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(10) In straight line method of depreciation, the written down value of a fixed asset will be at the end of the life of the asset as under: (a) Rupee one (c) None of these. (11) Sales budget must be prepared: (a) Independently (b) Depending on production capacity

(12) Consolidation of subsidiary accounts in the balance sheet of a unlisted Holding company is at present in Pakistan: (a) Compulsory (b) Voluntary

(13) Retained earning is synonymous to: (b) Profit for the year (c) None of these. (14) The requirements of an audit report for a Banking Company in Pakistan is under: (a) Under the Banking Companies Ordinance, 1962. (b) Under the Companies Ordinance, 1984.

(15) Deferred Taxation is: (a) Fixed asset (b) Fixed liabilities

(16) Investment Corporation of Pakistan follows: (a) Open-end mutual funds (b) Closed-end mutual funds

(17) Directors Report is ---- in respect of financial report constituent. (b) Voluntary for a limited Company (c) None of these. (18) Every limited Company in Pakistan is required by law to include the following along with financial reports: (a) Ratio Analysis (c) None of these.

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(19) Cash budget excludes the following: (b) Cash items (c) Purchase on Credit items. (20) NGOs are legally required to: (b) Prepare accounts as desired by donors. (c) None of these.

1. Fixed Cost: a. Changes with production c. None of the above 2. Conversion cost is: a. Material Cost + Overhead Cost b. Direct Labour + Material Cost

3. Process Costing is relevant to: b. Job Order cost oriented Projects c. None of the above 4. Operating Profit is: a. Profit after deducting financial costs b. Profit after deducting taxes

5. A good Cost Accounting System is: a. If it computes estimated cost only b. If it cannot be reconciled with financial accounts

6. Verification includes: a. Checking Vouchers b. Examining audit report

7. Stratified audit sample means: b. Purposively selected items for audit c. Items carefully selected from each group 8. Internal Control is totally synonymous with:

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a. Internal check b. Internal audit

9. Audit of a bank is generally conducted through: b. Couching c. Balance sheet audit 10. An auditor is liable for his annual audit of accounts o: a. Creditors b. Bankers

11. Income Tax is levied on: a. Agricultural Income c. None of above 12. If a firm has paid super-tax, its partners may follow any one of the following behaviours: a. No need to pay income tax, even if the income exceeds the taxable limit. b. Pay income tax, even if the income does not exceed the taxable income.

13. A resident multinational company need not: a. Pay income tax, if it s caused under Double Taxation agreement. b. If it is not enjoying tax exemption under the Income Tax Ordinance, 1979 (Second Schedule).

14. Income Tax rates are the same for: a. Limited Companies c. None of above 15. Super Tax on companies is: a. In vogue in Pakistan c. None of above 16. Current Ratio is calculated as: a. Fixed Assets/Current Liabilities b. Current Liabilities/Current Assets

17. Short-term loan can be described as: a. If the period is three years

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c. If the period is over one year

18. A partnership, in today’s Pakistan, under the current law can have the followi ng number of partners: a. 50 c. 100 19. Combination can be best described as: a. Restructuring of Capital of a Company b. Reduction of Capital of a Company

20. Sources of funds can be increased by: a. Describing selling prices b. Increasing expenditure

Write only the correct answer in the Answer Book. Do not reproduce the questions. (1) Books of original entry are called: (a) Ledger (b) Work sheets (d) None of these (2) For preparing balance sheets prepaid expenses are shown as part of: (a) Liability (b) Equities (d) None of these (3) Unpaid and unrecorded expenses are called: (a) Prepaid expenses (c) Additional expenses (d) None of these

(4) Amount, cash, or other assets removed from business by owner is: (a) Capital (c) Assets (d) None of these

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(5) Under the diminishing balance method, depreciation amount is: (a) Payment (b) Receipt (d) None of these (6) Users of accounting information include: (a) The tax authorities (b) Investors (c) Creditors

(7) The business form(s) in which the owner(s) is (are) personally liable is (are) the: (a) Partnership only (b) Proprietorship (c) Corporation only (e) None of these (8) The investment of personal assets by the owner: (b) (c) (d) (e)

Increases total assets only Has no effect on assets but increases owner’s equity Increase assets and liabilities None of these

(9) All of the following are forms of organizations except: (a) Proprietorship (b) Corporation (d) Partnership (e) None of these (10) Economic resources of a business that are expected to be of benefit in the future are referred to as: (a) Liabilities (b) Owner’s equity (c) Withdrawals (e) None of these (11) An owner investment of land into the business would: (a) Decrease withdrawals (b) Increase liabilities (d) Decrease assets (e) None of these (12) A cash purchase of supplies would:

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(a) Decrease owner’s equity (b) Increase liabilities (d) None of these (13) An owner investment of each into the business would: (b) (c) (d) (e)

Decrease liabilities Increase withdrawals Decrease owner’s equity None of these

(14) The payment of rent each month for office space would: (b) Increase liabilities (c) Increase owner’s equity (d) None of these (15) Real accounts are related to: (b) Expenses and incomes (c) Customers and Creditors etc. (d) None of these (16) Which one of the following accounts would usually have a debit balance? (b) (c) (d) (e)

Creditors Accounts payable Salaries Expenses None of these

(17) Quick assets include which of the following? (a) Cash (b) Accounts Receivable (c) Inventories (e) None of these (18) Net income plus operating expenses is equal to: (a) Net sales (b) Cost of goods available for sale (c) Cost of goods sold (e) None of these (19) The maximum number of partners in Pakistan can be fixed at the following: (b) 50 (c) 75

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(d) None of these (20) Balance sheet is always prepared: (a) For the year ended (c) None of these

Write only the correct answer in the Answer Book. Do not reproduce the questions. (1) The measureable value of an alternative use of resources is referred to as: (b) (c) (d) (e)

An imputed cost A different cost A sunk cost None of these

(2) A quantitative expression of management objectives is an: (a) Organizational chart (b)Management chart (d) Procedural chart (e) None of these (3) A cost center is: (a) A unit of production in relation to which costs are ascertained (b) A location which is responsible for controlling direct costs (c) Part of the factory overhead system by which costs are gathered (e) None of these (4) At break-even point of 400 units sold the variable costs were Rs. 400 and the fixed costs were Rs.200. What will be the 401 units sold contributing to profit before income tax? (a) Rs. 0.00 (c) Rs. 1.00 (d) Rs. 1.50 (e) None of these

(5) In considering a special order situation that will enable a company to make use of currently idle capacity, which of the following cost will be irrelevant: (a) Materials (c) Direct labour (d) Variable factory overhead (e) None of these

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(6) A fixed cost: (a) May change in total when such change is not related t o changes in production (c) Is constant per unit for each unit of change in production (d) May change in total, depending on production with the relevant range (e) None of these (7) Completion of a job is result in: (b) DR Cost of goods ……... CR finished goods (c) DR WIP ……………..….….. CR FOH control (d) DR FOH control …….….. CR FOH applied (e) None of these (8) Operating cost in often named as: (a) Manufacturing cost plus commercial expenses (b) Prime cost plus factory overheads (c) Direct material plus direct labour (e) None of these (9) Expenses such as rent and depreciation of a building are shared by several departments these are: (b) (c) (d) (e)

Direct expenses Joint expenses All of the above None of these

(10) If under applied FOH is closed to cost of goods sold, the journal entry is: ( (b) DR FOH control ……..……….. CR Cost of goods sold (c) DR FOH control ……..……….. C R Profit % loss account (d) None of these (11) Re-order quantity …… 3600 units Maximum consumption ...… 900 units per week Minimum comsumption …....300 units per week Re-order period …………….….5 weeks Based on this data Re-order level is: (b) (c) (d) (e)

3900 units 1200 units 400 units None of these

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(12) The time lag between indenting and receiving material is called: (b) Idle time (c) Stock out time (d) None of these (13) A credit balance remaining in FOH Control account is called: (b) Under-applied overhead (c) Actual overhead (d) None of these (14) Direct material cost plus direct labour cost is called: (b) (c) (d) (e)

Conversion cost Product cost All of these None of these

(15) Productivity means: (b) All units produced (c) Good units produced (d) None of these (16) A segment of the business that generates both revenue and cost is called: (b) (c) (d) (e)

Cost Center Cost driver All of these None of these

(17) Verification includes: (a) Checking vouchers (b) Examining audit report

(18) Audit of a bank is generally conducted through: (b) Vouching (c) Balance sheet audit (d) None of these (19) Economics resources of a business that are expected to be of benefit in the future are referred to as: (a) Liabilities (c) Withdrawals

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(d) Assets (e) None of these (20) Short term Loan can be best described as: (a) If the period is three years (c) If the period is over one year (d) None of these

(1) Maximum number of partners in a partnership firm set up in Pakistan under Partnership Act, 1932 is: (a) 5 (b) 25 (d) None of these (2) Preparation of final financial reports is governed in Pakistan under: (a) No law (c) None of these (3) Depreciation is based on: (b) Declared life of asset by supplier (c) Normal life of asset (d) None of these (4) Inventory turnover is calculated as under: (a) (b) Gross profit/Closing Inventory (c) Sales/Opening Inventory (d) None of these

(5) There is a difference between: (a) Worksheet and Balance Sheet (b) Worksheet and profit and loss account (c) Worksheet as combination of results of profits and financial positions (d) None of these (6) Deferred Revenue is: (b) Asset (c) None of these (7) Preparation of annual report of a firm is governed under:

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(a) Partnership Act 1932 (b) Under partnership Deed

(8) Deferred Taxation amount be treated as: (a) Foot note (c) None of these (9) Return of Equity will be calculated as under: (a) Operating Profit x 100/Equity (c) None of these (10) Current maturity of long term loan is: (b) Long Term Liability (c) None of these

Write only the correct answer in the Answer Book. Do not reproduce the questions. (1) Prime cost is calculated as under: (a) Manufacturing Cost/Cost of Goods Sold (b) Direct Method plus factory overheads (d) None of these (2) Process Cost is very much applicable in: (b) Pharmaceutical Industry (c) Air line company (d) None of these

(3) The latest computation of variances of manufacturing overheads is in one the following ways: (a) Two variance approaches (b) Three variance approaches (c) Four variance approaches (d) None of these (4) Random sampling in auditing means: (a) Selection through convenience sampling (c) None of these

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(5) Expenditure incurred in procuring machinery is: (a) An admissible expenditure for tax purposes (b) No admissible for tax purposes (c) None of these (6) Increase in income constitutes: (b) Outflows (c) None of these (7) M & A stands for: (a) Mergers & Analysis (c) Mergers & Allocation (d) None of these (8) An endowment insurance policy can be taken in respect of: (a) Fire insurance (b) Accident insurance (d) None of these (9) Audit and special audit are the same: (a) In Insurance Company (b) In Banking Company (c) None of these (10) Acid test is the same as: (b) Liquid test (c) None of these

(1) Acid Test Ratio is calculated as under: (a) Current Assets/Current Liabilities (b) Fixed Assets/Current Liabilities (d) None of these (2) Deferred cost is a: (a) Liability (c) None of these

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(3) Work Sheet is: (a) Balance Sheet (b) Fund Flows Statement (d) None of these (4) Banks, for the preparation of financial statements, are governed under: (b) State Bank of Pakistan Act (c) None of these (5) Return on investment is computed: (a) Investment/Profit x 100 (c) None of these

Write only the correct answer in the Answer Book. Do not reproduce the questions. (1) Rent of the premises constitutes variable expenses for cost allocation: (b) False (2) Sugar used in a sugarcane company is: (b) Fixed cost (c) None of these (3) An auditor is liable under the following circumstances: (a) Third Party Liabilities (c) None of these (4) Agricultural income is taxable under the Income Tax Laws of Pakistan: (a) True

(5) Principal and markup payment within one year constitutes long term liability for disclosure in the balance sheet of a company. (a) True

(6) Ordinarily one can have the following partners in a partnership in Pakistan under the Partnership Act 1932. (a) 10 (c) 30

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(d) None of these (7) Working Capital finance can be termed as “Running Finance” in a limited company. (b) False (8) Income from Capital gains arising out of trading on a stock strange in Pakistan is taxable these days: (b) False (9) Conversion Cost is calculated as under: (a) Labour Plus Materials (c) None of these (10) Current Ratio can be calculated as under: (a) Current Liabilities/Current Assets (c) None of these

(1) The need for keeping a record of income and expenditure is a clear and systematic manner has given rise to the subject of: (b) Accounting cycle (c) Manufacturing (d) None of these (2) If proper books of accounts are not kept in a business the amount of profit: (a) Can be ascertained (c) Easily ascertained (d) None of these (3) The stage under which transactions are recorded chronologically in the books of accounts is called: (a) Summarizing (b) Classifying (d) None of these (4) Book-keeping is mainly concerned with: (b) Designing the systems in recording, classifying, summarizing the recorded data

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(c) Interpreting the data for internal and external users (d) None of these (5) The term expenses and expenditure are: (b) Different in nature (c) Opposite in nature (d) None of these (6) When goods are given away as charity or free samples, the purchases account should be: (a) Debited (c) Recorded in balance sheet (d) None of these (7) The sale of a business asset on credit is recorded in: (a) Sales journal (c) Cash receipt journal (d) None of these

(8) The discount account is a: (a) Personal account (b) Real account (d) Asset account (e) None of these (9) The payment side of the cash book is under cost by Rs. 200 when overdraft as per bank statement is the starting point: (a) Rs 200 will be deducted (c) Rs 400 will be added (d) Rs 400 will be deducted (10) All the direct expenses are charged to: (a) Balance sheet (b) Profit and Loss account (d) None of these (11) Those liabilities which arise only on the happening of some event, are called: (a) Current liabilities (c) Outstanding liabilities (d) Fixed liabilities

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(12) Marshalling of balance sheet means: (b) The totaling of its assets and liabilities (c) Excess of assets over liabilities (d) None of these (13) Commission received in advance is to be considered as: (a) Outstanding expense (b) Accrued income (c) Prepaid expense

(14) The provision for discount on creditors is often not provided in keeping with the principle of: (a) Materiality (b) Consistency (d) Realization (15) Which one of the following is not considered the permanent part of the accounting record: (a) Journal (c) Balance sheet (d) Final accounts (16) A working paper which is prepared by the accountant for his own convenience is called: (b) Cash flows statement (c) Balance sheet (d) Final accounts (17) Any expenditure incurred to increase the profit earning capacity of the concern is a: (b) Capital expenditure (c) Deferred revenue expenditure (d) Capital expenditure (18) Depreciation on fixed assets is an example of: (a) Revenue expenditure (c) Deferred revenue expenditure (d) None of these

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(19) The capital receipts are shown in the balance sheet on the: (b) Asset side (c) Debit side (d) None of these (20) Error due to wrong allocation as expenditure between capital and revenue is regarded as: (a) Error of omission (c) Compensation errors (d) Error of commission

(1) The purchase of machinery on account would (a) Increase an asset and decrease another asset (b) Increase an asset and decrease liability (d) Decrease an asset and increase liability (2) In general, the accounts in the income statement are known as: (a) Real account (b) Contra asset (d) Unrecorded revenue account (3) In general terms, financial assets appear in the balance sheet at: (b) Current cash value (c) Cash (d) Estimated future sales value (4) A limited Co. sold marketable securities cost Rs. 80,000 for Rs. 92,000 cash. In Co.’s income statement and statement of cash flows respectively, this will appear as: (b) A Rs. 92,000 gain and Rs. 8,000 cash receive (c) A Rs. 12,000 gain and Rs. 80,000 cash receive (d) A Rs. 92,000 sales and Rs. 92,000 cash receive (5) Which of the following is least important as a measure of short term liquidity? (a) Debtor ratio (b) Current ratio (d) Quick ratio

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(6) Uzma Ltd. Net income was Rs. 4,00,000 in 2003 and Rs. 1,60,000,in 2004. What percentage increase in net income must achieve in 2005 to off set the decline in profits in 2004? (a) 60% (c) 200% (d) 70% (7) Which of the following does not describe accounting? (a) Language of Business (c) Useful for decision making (d) Used by business government, nonprofit organizations and individuals. (8) External uses of financial accounting information include all of the following except: (a) Investors (b) Labour unions (d) General public (9) A fixed budget is: (b) A budget which ignored inflation (c) Used only for fixed cost (d) An overhead cost budget (10) Heavy expenditure on advertisement of a new product is a: (a) Capital expenditure (b) Revenue expenditure (d) None of these (11) Subscriptions received in advance is: (a) An income (b) An asset (d) A loss (12) At the time of admission of a new partner, goodwill raised should be written off in: (a) New profit sharing ratio (c) Sacrificing ratio (d) Gaining ratio

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(13) A and B are partners in the ratio of 2:1. They admit C for ¼ shares who contributes Rs. 3000 for his share of goodwill. The total value of the goodwill of the firm is: (a) Rs. 3,000 (b) Rs. 9,000 (d) Rs. 15,000 (14) Sales to Mustafa of Rs. 10,000 not recorded in the books would affect: (a) Sales account (b) Mustafa account (d) None of these (15) Depreciation is a process of: (a) Valuation (c) Both a & b (d) None of these (16) Loss on sale of an asset should be written off against: (a) Share premium account (b) Sales account (c) Depreciation fund account ( P & L A/C Dr and Fixed Asset Cr ) (17) Income and expenditure account reveals (a) Cash in hand (c) Capital account (d) None of these (18) Which of the following is true regarding the work sheet. (a) It is the form, which an accountant uses for his own aid and convenience. (b) It assists in the orderly preparation of the adjustments and financial statements at the end of the account period. (c) It can substitute for Journal and ledger

(19) The post closing trial balance will: (a) Contain only income statement accounts (c) Contain both income statement and balance sheet accounts (d) Be prepared before closing entries are posted to the ledger

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(20) The cost of goods and services used up in the process of obtaining revenue are called: (a) Net income (b) Revenue (d) Liabilities

(1) There is no difference between Financial Report and Financial statement. (True/  ) (2) Calculating number of days uncollected of sales is known as Collection Index. (True/  ) (No such a word exist in accounting lexicon) (3) Wages paid for construction of a plant is revenue expenditure. (True/  (4) Times interest earned is a great interest for a banker. (True/ 

)

)

(5) Budgeted Profits are always high when pessimistic approach for preparing budget is followed. (True/  ) (6) Work Sheet only presents Balance Sheet figures. (True/  (7) Trial Balance is prepared from ledger. (

)

/False)

(8) Banks are governed under the Companies Ordinance, 1984 only for preparation of their financial statements. (True/  ) (9) Suspense Account is a clear account with no question to be asked. (True/ 

)

(10) Ledgers are prepared from vouches much before transactions are recorded in the Journal. (True/  )

(1)Which of the following best describes the nature of an asset? (a) Something with a ready market value

(c) The amount of the owner’s investment in a business (d) None of these (2) A balance sheet is prepared to find out financial position of a firm: (a) For a specified period

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(c) At the time of sale of business (d) None of these (3) The preparation of work sheet: (a) Constitutes creation of a formal financial statement (b) Eliminates the need for entering adjusting entries in the journal (c) Provides the information needed for journalizing adjusting and closing entries

(4) Assets would be overstated if necessary adjusting entry was omitted for: (a) Expired Insurance (c) Accrued Interest Earned (d) None of these (5) The book value of the depreciable asset is best defined as: (b) The price that the asset would fetch if offered for sale (c) Accumulated depreciation of the asset since acquisition (d) None of these (6) Which of the following is not an intangible asset? (a) A patent (b) A trademark (d) None of these (7) A company has current ratio of 2 to 1 at the end of year 1. Which one of the following transactions will increase this ratio? (b) Declaration of a 20% cash dividend (c) Collection of a large account receivable (d) None of these (8) If sales increase by 10% from year 1 to 2 and cost of goods sold increases only 6%, the gross profit on sales will increase by: (b) 10% (c) 6% (d) None of these (9) Which of the following is not an acceptable inventory method? (a) Lower of cost or market (c) Specific identification (d) None of these (10) which of the following amounts appears in both the income statement and balance sheet?

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(b) Accumulated depreciation (c) Dividends (d) None of these (11) Both the accounts for depreciation expense and accumulated depreciation: (a) Are closed at the end of the period (b) Appear in the Adjusted Trial Balance Columns of the worksheet (d) None of these (12) When a partnership is liquidated: (a) Any cash distribution to partners is allocated according to the profit and loss sharing ratio. (b) Cash is distributed to each partner according to his or her capital account balance before the sale of partnership assets. . (d) None of these (13) In projecting the future profitability of a trading company, investors will be least concerned with changes in: (a) The gross profit rate (c) Sales volume (d) None of these (14) Revenue is most commonly recognized at the time when: (a) Cash is collected (b) The order is received from customers (d) None of these (15) Which of the following list of accounts is used to compute the cost of goods sold? (a) Purchases, inventory, and sales returns. (b) Gross profit, purchase returns and carriage inward. (d) none of these (16) which of the following is ascertained by drawing up an income and expenditure account? (a) Cash in hand (b) Capital Fund (d) none of these (17) On April 1, Hassan & Company received and paid a Rs.700 bill for the advertising done in March. In addition to this bill the company paid Rs. 6,100 during April for

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expenses incurred in that month. Hassan & Company paid Rs.3,600 as salary to employees for work done in April. Based on these facts, total expenses for the month of April were: (a) Rs.6,100 (b) Rs.6,800 (c) Rs.10,700 (Bill of march Rs 6100 + Salary exp Rs 3600= Rs 9700 ) (18) Which of the following categories of accounts are closed at the end of an accounting period? (b) Permanent accounts (c) Personal accounts (d) None of these (19) A retail store had current assets of Rs.72,000 and a current ratio of 2 to 1. The amount of working capital must have been: (a) Rs.144,000 (c) Rs.72,000 (d) None of these (20) Bond holders would be most interested in which of the following? (a) Quick ratio (b) Inventory turnover (d) None of these

a. Trial balance b. Income statement c. Balance sheet

a. Office supplies (Debit) b. Cash (Debit) c. Wages payable (Credit)

a. Straight line c. Declining balance

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d. Depletion

a. Accrued revenue b. Accrued expenses c. Unearned Revenue

a. It is a separate legal entity c. Income that is distributed to owners is usually taxed twice d. Ownership rights can be easily transferred

b. A debit to a liability account must create a credit to an asset accounts c. Total debits must equal total credits d. None of these

a. LIFO c. Average d. The most recent purchase price

a. Purchase of an asset for Rs. 20.000 cash b. Asset costing Rs. 20,000 destroyed by fire d. Collection of Rs. 20,000account receivable

b. 10% c. 20% d. 25%

b. Is a closing entry? c. Usually includes an offsetting credit either to cash or accounts payable. d. Is not an adjusting entry?

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a. Ratio analysis b. Horizontal analysis c. d. None of these

b. Capital nature only c. Both (a) & (b) d. Income of revenue nature and expenditure of revenue and capital nature

a. New profit sharing ratio c. Sacrificing ratio d. Gaining ratio

a. Rs. 3000 b. Rs. 9000 d. 15000

a. Rs. 10,000 b. Rs. 11,000 d. None of these

b. Rs.45000 c. Rs.39700 d. Rs.34825

a. Debit ratio b. Equity ratio d. None of these

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a. Freight in c. Purchase discount d. Purchase return

a. Cash bonus b. Reversionary bonus c. Interim bonus

a. An expense b. An income d. An asset

(a) The owner withdrew Rs. 1,600 from the business for personal use (b) Purchased a photocopying machine for Rs. 2,750 cash (c) Purchased medical supplies for cash from Healthcare Labs. Rs. 1,630

(a) The journal shows in one place all the information about specific transactions arranged in chronological order. (b) A ledger account shows in one place all the information about changes in a specific asset or liability or owner’s equity.

(d) The product of the accounting cycle is the formal financial statements such as balance sheet and income statement.

(a) Statement of cash flows (b) Income Statement (d) Statement of owner’s equity

(b) To establish complete accuracy of accounting records. (c) To determine the amounts payable to suppliers for purchase of goods on credit. (d) To ensure efficient use of resources of the business.

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Agha Zuhaib Khan

(a) Rs. 70,000 (b) Rs. 1,30,000  (d) Rs. 63,000 (200,000 – 180, 000 – X = 70, 000( 0.35* 200,000 = 70,000 )) = X= 50, 000

(a) Closing entries are made befo re adjusting entries. (c) Adjusting entries are made after financial statements are prepared. (d) Financial statements are prepared after closing trial balance.

. (b) Leasehold land. (c) Loose tools. (d) Copy rights.

(a) Cash is paid (b) The purchase order is placed with the supplier  (d) None of these

(a) Is widely used by manufacturing firms. (b) Is often used by merchandising firms. (d) Can not be used in filing income tax returns.

(a) Generally gives best results because it is easy to apply

(c) Is the best method used for wasting assets. (d) Ignores fluctuations in the rate of asset usage.

(a) Revenue accounts (b) Expense accounts (c) Drawing accounts

(a) At the time of purchase of goods (b) At the time of sale of goods  (d) None of these

(a) Repayment of long term debt (c) Payment of an account payable (d) Acquisition of treasury stock.

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Agha Zuhaib Khan

(a) Purchase of furniture for Rs. 1 0,000 (b) An asset costing Rs.10,000 was destroyed by fire (d) Collection of a Rs.10,000 account receivable

 (b) Equity Ratio (c) Debt Ratio (d) Quick Ratio

(a) The company’s fiscal period (b) The sales volume of the business (c) (d) Nothing meaningful

(a) Earnings and dividends per share (b) Book value per share (c) The available supply of shares and the demand to purchase the shares.

(a) Fully reliable (b) Tentative in nat ure (c)  (d) Always misleading

 (b) Controller (c) Secretary (d) Treasurer

(a) Among the assets (c) Among the liabilities (d) None of these

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